ACCORDING to the CIA China has a "50-50 chance" of falling apart after the death of Deng Xiaoping. The day of reckoning cannot be far off given his daughter's recent confession that his health worsens daily.
The succession crisis that is about to erupt is only one of the changing factors in the politics of the country. The prospects of a trade war with the USA loom large. And China's economy is beginning to show signs of overheat.
First in line to take over is President Jiang Zemin. He was Deng's third choice as sucessor - Hu Ziyang was dismissed for being too liberal and Zhao Ziyang was purged because of his sympathies with the Tiananmen protesters..
Jaing has his base in the army. He is chair of the military affairs commission. The People's Daily has recently issued statements calling for the people to "rally round" his leadership. He has lately taken to wearing his Mao jacket in place of his business suit.
Li Peng the Prime Minister is also hoping to benifit from Deng's demise. He is worried that a reassessment of Tiananmen may be made post-Deng -he would inevitably come out badly from this because his known enthusiasm for martial law.
The CIA's Pentagon report says that "the political fate of China is up for grabs".
The balence is delicate: "there is a 50-50 chance that China would disintegrate under a post-Deng diffused leadership and internal conflict. Power in general will gravitate away from the centre."
The waiting game is made even more tense by the trade standoff with the United States. Michael Kantor the US trade representative has threatened 100 per cent tariffs on Chinese exports worth more than $2 billion.
Although the USA has never actually acted upon its threats of trade sanctions the warnings serve as an important intervention into the political life of the country.
As well as rising inflation and a flood of immigration from the country to the cities the disparities of wealth and income are begining to cause social tension.
At the September 1994 Central Committee of the CCP Li Peng launched a fight to strengthen the power of the cen-